As GM and Chrysler close dealerships, Tesla seeks to expand into new regional markets

Almost all car manufacturers have been affected by the global recession, but Tesla Motors is sticking to its expansion plans. The innovative electric car manufacturer plans to open seven new stores this summer which will expand its sales into new regional areas. Unlike most companies which have a dealership network, Tesla will own all of its sales and service centers, enabling strong price and service control.

Tesla currently has two stores open; one in Silicon Valley and another in west Los Angeles. The first new stores will open in New York City, Seattle, and Chicago. It is not a coincidence that these are major metropolitan areas with strong environmental movements. Tesla's NYC store will be located in the trendy Chelsea Art District of Manhattan, while Seattle's South Lake Union neighborhood (heavily invested in by Microsoft's Paul Allen and his Vulcan Real Estate arm) and Chicago's West Town will host the new stores.

These first five stores are located in states that either have sales tax exemptions on hybrids and electric vehicles or are considering legislation authorizing them. For example, Washington state has a sales tax exemption all battery-electric hybrids and plug-in hybrid electric vehicles. These incentives are on top of a $7,500 US Federal Tax Credit, which fully applies to all Tesla vehicles.

International expansion will come with a new store in London, England, followed by stores in Munich, Germany, and the Principality of Monaco. The Monaco store will also target customers in nearby France, Switzerland, and Italy. Potential customers from the nearby Czech Republic and Austria may also seek out the Munich store. The city of London is an obvious choice for a store due to its congestion charge, a fee based system to raise funds from drivers for its massive transportation infrastructure. Hybrid and electric vehicles are required to register, but are given a 100% discount. Tesla's first European deliveries are scheduled for this summer as well.

A Miami store will open later this summer to serve customers in Florida. Tesla is considering locations for its first Canadian store in Toronto, as well as possible sites for a store in Washington, D.C. Other locations will follow to serve other major metropolitan markets.

Tesla Motors has conducted research into retail design, and claims to have taken "showroom cues from Apple, Starbucks and other customer-focused retailers". All of their stores feature computers with free Internet access to while away time during maintenance, which is brief due to the simplified design of its electric architecture. Most maintenance is spent on brake inspections, although the occasional recall and powertrain upgrade will take longer.

"We are rethinking almost every aspect of the automobile - from the powertrain to
the customer experience, both online and in our stores," said Elon Musk, Tesla's CEO.

The stores might be a little bare since more than 500 customers are still waiting for their own Tesla Roadster, the company's sole production vehicle. The Roadsters currently in stores are mostly prototype and engineering validation vehicles. Tesla is delivering 20 to 25 new Roadsters per week, after being assembled by Lotus in Hethel, England and finished in California. It recently delivered its 500th Roadster to Martin Tuchman, a New Jersey philanthropist who plans to charge his Roadster partly with solar energy thanks to photovoltaic panels he helped install throughout his hometown of Kingston, New Jersey.

Besides Tesla's Roadsters, the new stores will also sell and service the company's new Model S electric sports sedans when they enter production. More than 1,200 deposits have been placed for the Model S sedan, which will cost around $50,000 with the U.S. Federal Tax Credit.

"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer